WARN Act Impacts Certain Employer Layoffs

By Sandra Hoglund Hanson

The WARN Act

In our changing economy, employers may be forced to consider laying off employees. If a layoff or plant closing may be in store, employers need to keep the WARN Act in mind. See 29 U.S.C. §§ 2101, et seq.

WARN stands for “Worker Adjustment and Retraining Notification.” The WARN Act is a federal law requiring larger employers to give 60 days written notice in advance of plant closings or mass layoffs. It is intended to give displaced workers and their families transition time to seek alternate employment or training before the end of their employment.

Who and what is covered?

As a general rule, the WARN Act applies to employers with 100 or more employees, when the employer plans to lay off or terminate at least 50 employees at a single site of employment. Such employers must given written notice to employees, union representatives, and government officials at least 60 days before a plant closing or mass layoff. The terms “plant closing” and “mass layoff” are specifically defined by WARN and its implementing regulations. These definitions may or may not cover particular situations.

Exceptions

There are exceptions to the WARN Act’s requirement of advance notice in certain circumstances. These include: (1) faltering company status; (2) unforeseeable business circumstances; (3) natural disasters; and (4) closure or completion of a temporary project or facility. The Act also does not apply to strikes or lockouts.

Enforcement

The WARN Act is enforced by civil actions against employers. Violation of the WARN Act may result in liability to affected employees for back pay and benefits during the period of the violation, as well as civil penalties and attorneys’ fees.

This is a very broad overview of the WARN Act, intended simply to alert employers and employees to its general provisions. The WARN Act itself and its implementing regulations include much more detailed information about its application to specific circumstances, e.g., implications of the Act for part-time employees. You should not rely on this summary for your understanding of the WARN Act. Please contact our offices for assistance if you believe your circumstances may be impacted by the WARN Act.